OK, now it’s even more serious. A very unambiguous statement from China’s Foreign Ministry states in so many words that
“China will not, under any circumstances, accept any agreement that undermines its interests and will respond with firm and reciprocal countermeasures,”.
America’s extraordinarily clumsy trade diplomacy is taking a familiar turn.
A patchwork of stupidities in the form of proposed fees for Chinese ships.
This will also negatively affect California, which is trying to dodge the worst effects of the tariffs.
Absolutely no movement on a proposed US-China deal. Like many Trump “deals”, the talk is big, the results are effectively non-existent.
The supposedly “impossible” situation for China’s neighbors. Not as bad as it seems. Asia can work with Beijing without unnecessary friction. It’s unlikely Trump knows much, if anything, about how business is done in the region or global trade in general. The preceding link refers to Jeffrey Sachs comparing Trump unfavorably to Mickey Mouse for those interested.
The EU, Japan, Canada, Australia, and the Middle East definitely aren’t going to stop doing business with China, end of discussion. The trade volumes and values are huge.
A broke, incoherent, and incompetent America is no great asset to global trade. The scorched earth approach to trade couldn’t be more unrealistic.
It’s more likely that American firms will have to do business overseas to maintain their own values. John Deere seems to be a likely model.
Ford, alternatively, has stopped shipping to China, indicating that they need to rely on sales in other markets. This move was a direct result of Chinese tariffs which have raised import fees and therefore sales prices in China enormously. There’s no way of knowing whether this will be viable given the retaliatory tariffs worldwide and relative volumes of sales.
None of this is doing the US any kind of good. When the UK decided to “secede from the world”, trade simply went elsewhere. Nobody could be bothered to do business in such a weird and expensive environment. The US economy is much bigger, but the obstacles to trade are punishing and already far too expensive.
That’s likely to get a lot worse if the US dollar goes too far down. Just about every other currency is now rising against the USD. That weakens the trade position and ironically makes debts in US dollars much cheaper to the point that these loans could be self-destructive.
At the same time, imports from anywhere in the world would be more expensive in this scenario.
Nobody would be surprised to be offered “exclusive” deals by the US at China’s expense. The sheer primitiveness and naivete of this administration’s conduct are monotonous and extremely counterproductive.
The world isn’t listening to the bluster anymore.
The world can wait. Trump’s frenzied America can’t afford to wait.
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Disclaimer
The opinions expressed in this Op-Ed are those of the author. They do not purport to reflect the opinions or views of the Digital Journal or its members.
